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What Happens If Your Personal Circumstances Prevent You from Mitigating Damages from Your Wrongful Dismissal?
Employment Law

What Happens If Your Personal Circumstances Prevent You from Mitigating Damages from Your Wrongful Dismissal?

Employees who are wrongfully dismissed are generally expected to make reasonable efforts to mitigate the damages arising from their termination. Typically, this involves attempting to find new, comparable employment. If an employer can show that the former employee (1) did not make reasonable efforts to find replacement work, and (2) would likely have obtained work had those efforts been made, courts will usually reduce any wrongful dismissal damages awarded to the employee.

In court, employees usually try to avoid such an outcome by providing evidence of their mitigation efforts in the form of a log of jobs that they have applied for and copies of application confirmation emails. However, what happens if your personal circumstances prevent you from being able to apply to a large number of positions, or any at all?

Although, in such circumstances, former employers will generally try to argue that you have failed to make reasonable efforts to mitigate your damages, Canadian courts have recognized that in some cases, people’s personal circumstances make mitigation near impossible, or at least quite difficult. Some situations in which this might occur involve the former employee’s health or high degree of specialization.

Mitigation and Health Problems

Courts have held that in assessing reasonable efforts to mitigate in wrongful dismissal cases, regard must be had to the Plaintiff’s physical and mental condition. For example, in Systad v Ray-Mont Logistics Canada Inc, 2011 BCSC 1202, the British Columbia Supreme Court found that a former employee had not failed to mitigate his damages even though he only made minimal efforts to find new employment because he had a necessary knee surgery which prevented him from doing more. His circumstances not only meant that additional efforts would exceed what was reasonable, but that it was unlikely that he would have obtained new employment with such additional efforts as he would have to delay his start date until he recovered.

Interesting and related jurisprudence that has emerged is that courts have recognized that the end of employment can have a significant impact on mental health, oftentimes interfering with one’s ability to search for new employment in the months following termination. In Brake v PJ-M2R Restaurant Inc., 2017 ONCA 402, the Court of Appeal for Ontario affirmed the lower court’s decision, which held that “[d]elay in commencing a job search or a gap in job search because of the emotional upset associated with dismissal will not be held against the employee.  The courts have tacitly acknowledged that most employees require a certain period of post-termination readjustment and regrouping before they can realistically pursue re-employment strategies.”

Mitigation and Specialization

In some cases, people are terminated from unique or highly specialized positions that they held for a significant amount of time. This can result in a highly specific skill set that is unsuitable to most, if not all, positions that are available. Courts have also recognized the difficulties in mitigating damages in such circumstances.

For example, in Nikkel v. The College of Pharmacists of British Columbia, 2015 BCSC 1720, the Supreme Court of British Columbia found that an inspector of pharmacies would have to return to practice as a pharmacist in order to find alternative employment. Although the employee had not lost her designation as a pharmacist, she had been in a highly specialized role for over 15 years and needed to upgrade her skills to recommence practice as a pharmacist. As she had taken reasonable steps to gain the skills required to practice in a different area, the fact that she had not made any inquiries regarding paid employment in the nine months since her termination did not constitute a failure to mitigate her damages. She was not required to apply to positions for which she had the qualifications but lacked the requisite skills due to having practiced in a different and highly specialized area for many years.

Takeaways

Mitigation requirements are limited to what is reasonable in the particular circumstances – they do not require former employees to apply to as many positions as possible regardless of whether they will be able to perform the work or accept the job. Employees who have been wrongfully dismissed should do their best to apply to many new positions, but they should not be overly concerned if their personal circumstances legitimately prevent them from doing so.

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